Billions of pounds of aid spent in postwar reconstruction across the globe creates political instability and violence, according to a controversial new study.

The research, carried out in the Middle East, Africa and the Balkans for Tiri, a new non-governmental organisation dedicated to encouraging transparency and democracy in developing countries, will fuel the debate over whether established ways of delivering aid are failing.

The controversy follows the disastrous outcomes of a series of major reconstruction programmes: in Iraq and Afghanistan, where ineffective rebuilding plans have been beset by problems with corruption; in Sri Lanka following the tsunami, where the distribution of aid has contributed to the restarting of the civil war; and in the reconstruction of New Orleans after Hurricane Katrina, where over $1bn in aid has already been wasted.

The Tiri survey set out to examine the impact of post-conflict reconstruction in eight states and regions which between them have received $65bn in aid: Afghanistan, Bosnia, Kosovo, Palestine, Lebanon, Mozambique, Sierra Leone and Lebanon. It concludes that:

· up to 50 per cent of aid budgets are lost to corruption, fuelling dangerous public resentment;

· the international community undermines the emergence of accountable democratic institutions by imposing its own 'champions for change' and tolerating patronage;

· too much aid is designed to meet the political priorities of the donor countries and institutions and not the needs of the beneficiaries.

'We have thousands of white Toyota Land Cruisers [the vehicle indelibly associated with the image of the aid worker] cruising around the world,' said Martin Tisne, one of Tiri's programme directors. 'The question is, what have we got to show for it?'

'Many of the problems are driven by the way the aid industry works,' adds Tisne. 'Clearly in humanitarian disasters, if you need food somewhere in a week, it needs to be there in a week. But in the issue of reconstruction and development aid - which is where the vast amount of money goes - it also speeds forward at a pace that often is out of touch with the reality on the ground.

'You have this rapid round of donor conferences and targets and timetables, and it is only when you look round, sometimes years later, that you realise that what you have done has contributed to renewed tension and violence in post-war situations.'

At the presentation of the report in London, members of Tiri's board, who include former International Development Secretary Clare Short, were equally blunt in their assessment.

'We have got to recognise,' said Short, 'that the way we do business may be contributing to new conflict.'

'What we are saying,' said Jeremy Carver, one of Tiri's founders, 'is that too often the actions of the international community in postwar societies directly leads to new conflict. It is driven by the insistence of countries and international organisations that reconstruction follows their agendas and tight timetables.'

The destabilising risk of corruption in Afghanistan was underlined by the author of the Afghan section of the survey, Yama Torabi, a consultant for Integrity Watch, Afghanistan.

'Nearly every time there has been sudden regime change in Afghanistan it has been linked to the issue of corruption. What is so dangerous for Afghanistan right now is that the percentage of the public who perceive the western-backed government of Hamid Karzai to be corrupt is now some 60 per cent, the highest for an Afghan regime.'

The story is not confined to Afghanistan. 'We have seen the same thing to a lesser degree elsewhere,' said Carver. 'In Kosovo, the complete incompetence of EU officials has fuelled staggering corruption. And in Lebanon's reconstruction after the civil war there was an enormous volume of diversion of money.'

Another issue raised by Tiri is the lack of cost-effectiveness of much of the aid being handed out.

'There is a continuing fundamental misunderstanding,' said Tisne, 'that it is the size of the funds that matter. It is not: it is all about where they go and the way they are spent. In Afghanistan, the World Bank head there calculated last year that for every $1 given directly to the Afghan government to use, big governmental agencies such as USAID had to spend $8 to have the same effectiveness.'